Nippon Paper plans $71 million 'green energy' cogeneration project in Port Angeles
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An artist's rendering shows a planned $71 million cogeneration facility that would be built in front of Nippon Paper Industries USA's existing paper-making plant in Port Angeles. Shown is a triangular-shaped biomass storage building and, behind it, buildings housing a new steam boiler and turbine generator.

Peninsula Daily News

Port Townsend Paper's biomass project
PORT TOWNSEND — The public will have additional time to comment on a proposed state order that would allow Port Townsend Paper Corp. to modify its mill to produce “green electricity.”

The state Department of Ecology has extended the comment period on the “notice of construction” to 5 p.m. Aug. 23. The original deadline was Aug. 18.

Ecology has scheduled a public hearing on the proposed order for Port Townsend paper mill at 6:30 p.m. Aug. 17 at the Fort Worden Commons, Company A.

After a short presentation and question-and-answer session about the order, Ecology officials will take formal testimony.

The state order would clear the way for a cogeneration project using wood chips.
The project, in which the mill's main boiler would be converted to use waste wood from the North Olympic Peninsula, is intended to generate “clean” power while cutting some emissions and providing enough electricity to sell.

The state order, which is expected to be issued in September after public comment has been reviewed, would approve the mill's proposed co-generation project for producing for sale up to 25 megawatts of “green power” electricity Ecology said in a statement.

To sell electricity as “green power,” the mill must limit the amount of fuel oil it uses and would use less than it does now, said Merley McCall, manager of the industrial section of the state Department of Ecology.

The waste wood would “come from the forest slash in that vicinity,” much of which is now burned in the field, McCall said.

Ecology's order sets limits to such pollutants as particulate matter, nitrogen oxides and sulphur dioxides and sets carbon monoxide limits, McCall said.


The conversion would result in a drop in some emissions and a slight increase in two others, he said.

Mill officials have said the project would help the mill retain its existing 209 jobs while creating 108 temporary jobs.

The mill expects to begin construction by the end of the year, with the new system to be in operation by mid-2012, according to a mill brochure that said that about $10 million in pollution control equipment would be added as part of the upgrade.

In October, the Port Townsend Paper Corp. mill was awarded a $2 million Renewable State Energy Program grant from the state Department of Commerce to upgrade its biomass cogeneration boiler and plant.

The state dispersed federal money from the American Recovery and Reinvestment Act.
Port Townsend Paper also agreed to leverage $53 million in additional funding to match the grant.

The order is posted at http://tinyurl.com/
382porh.

Copies are available locally at the Port Townsend Library, 1220 Lawrence St.
Comments can be mailed to Marc Heffner, Department of Ecology, Industrial Section, PO Box 47706, Olympia, WA 98504-7706.

They can be e-mailed to Mhef461@ecy.wa.gov, or faxed to 360-407-6102.
Peninsula Daily News
PORT ANGELES -- Nippon Paper Industries USA plans a $71 million "green energy" cogeneration plant for its Port Angeles mill.

The project includes a new state-of-the-art steam boiler and a turbine generator which would make the company more efficient, reduce overall air pollution and produce 20 megawatts of energy from forestry biomass -- residue from local timber operations -- that would be sold to power companies.

It is also expected to create more than 20 jobs in the forest industry.

The project was announced Friday by Harold Norlund, Port Angeles mill manager, after it was approved by the board of directors of Nippon Paper Group, Nippon USA's parent company in Tokyo.

"Today we announce the investment of $71 million in our community," Norlund said in a statement.

"The cogeneration of steam and electricity from this project will take our business to a new and more sustainable level and allow us to continue to improve our paper making business," he added.

Norlund said that the plant would create more than 20 new jobs "through the harvesting of forest residual biomass that would otherwise be left in the woods or burned in slash piles."

The biomass fuel would come from throughout the North Olympic Peninsula, he said.

In addition to the forestry jobs, Norlund said, "the project will result in design and construction jobs in foundation, boiler and building construction at the Port Angeles mill" during some 18 months of construction.

The almost 200-employee Port Angeles mill -- which makes paper used for telephone books, other custom paper and newsprint -- expects to begin construction later this year after necessary environmental studies have been done and state and local permits have been approved.

The mill now uses steam from one large biomass boiler, two smaller oil-fired boilers and an electric boiler.

The main boiler was built in the 1950s, Norlund said.

The new equipment would be capable of being powered by 100 percent biomass, and would produce more steam than the previous one, enough to supply the paper mill and a 20- megawatt turbine generator.

The boiler and other equipment is expected to be ready for testing in the second quarter of 2012.

The project would add a 5,000-square-foot boiler building and another 5,000-square-foot building to house the turbine generator, as well a 3,000-square-foot building to house air pollution control equipment that has a stack serving as an exhaust for the boiler fire.

Once power generation shifted to the new equipment, "that big vapor plume that you see will be gone," Norlund said.

Perhaps the most striking aspect of the additions would be a 14,000-square-foot triangular building for storing biomass fuel.

The shape would minimize dust buildup, Norlund said.

Board approval was the first hurdle in realization of the project, Norlund said.

Now, the company -- which has spent more than $500,000 on design by Amec in Vancouver, B.C., and on feasibility studies -- must focus on acquiring an air permit through the Olympic Region Clean Air Agency and other environmental permits.

"Air and environmental permits must be approved before we can continue to keep investing," said Norlund, adding that the company has not gained any grants or loans for the project so far, although it hopes to apply for federal funds in the future.

A portion of the company's $71 million investment is expected to be reimbursed to the company through federal grants, said Norlund, saying that there is a potential for up to 30 percent reimbursement.

So far, the company has been told it could be eligible for federal Department of Commerce money in the form of a $1.4 million loan and a $600,000 grant, once it signs a contract for the project.

The company has not applied for any grants or loans.

"There are lots of hurdles for us before that is available to us," Norlund said.

The public comment period on a draft environmental impact study led by the city of Port Angeles closed last week.

The city will prepare a final draft after reviewing the public comments. The draft is available at www.cityofpa.us/.

The draft impact statement said that "the emissions of most air pollutants from the mill would be substantially reduced" because of state-of the art-air pollution controls.

Norlund said it is estimated that the new boiler would result in a 19 percent overall net reduction of pollutants from the company's paper-making process, with significant decline in major pollutants such as carbon monoxide, particulate matter and sulfur dioxide.

Emissions of two pollutants would increase slightly, he said.

He said he expects a full payback of the company's investment "over a reasonable amount of time" through more efficient, cost-effective operations and the sale of the biomass-fueled "green" electricity to power companies.

Potential customers would include local agencies such as Clallam Public Utility District.

"The power produced by this boiler will be sold as renewable energy that meets the requirements of the renewable energy portfolio standards passed in many states, including I-937 passed by Washington voters," Norlund said.

The company owns its own electrical power lines for transmission of the energy.

Earlier this year, the state Department of Natural Resources selected Nippon as one of four Forest Biomass Initiative partners to use forest residuals from state lands for green energy projects on a pilot basis.

The Port Angeles mill has been in existence -- owned by different companies -- since 1920.

Nippon acquired the mill from another Japanese company, Daishowa America, when it bought Daishowa in 2003.

Last modified: August 08. 2010 1:55AM
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